## Objective Questions

*Question*

Which of the following statements is TRUE?

- The sum of the coefficient of determination (R2) is the absolute value of the coefficient of correlation r
- The square root of the coefficient of determination (R2) is the absolute value of the coefficient of correlation r
- The difference of the coefficient of determination (R2) is the absolute value of the coefficient of correlation r
- None of the given statements is true

Answer: | Chapter No. |

*Question*

Two products are said to be substitutes if cross price elasticity of demand between these two products is:

- Positive
- Negative
- Zero
- Infinite

Answer: | Chapter No. |

*Question*

A function that relates inputs with outputs is called:

- Production function
- Consumption function
- Investment function
- Demand function

Answer: | Chapter No. |

*Question*

Periods of economic expansion and contraction in an economy is named as:

- Business cycle
- Life cycle
- Poverty cycle
- Unemployment cycle

Answer: | Chapter No. |

*Question*

To avoid the problem of bandwagon effect, ___________ method of forecasting is used.

- Personal insight
- Panel consensus
- Delphi
- Time series

Answer: | Chapter No. |

*Question*

The quantity of a good or service that producers are willing and able to sell during a certain period of time is known as:

- Demand
- Supply
- Market demand
- Market supply

Answer: | Chapter No. |

*Question*

The total cost (TC) function is given as: TC = 200 + 80Q. What is the variable cost?

- 80Q
- 200
- 350
- 200

Answer: | Chapter No. |

*Question*

Y = a + bX + e In this regression equation, "X" is:

- Dependent variable
- Independent variable
- Slack variable
- Random variable

Answer: | Chapter No. |

*Question*

Tax rates are determined by the government in:

- Fiscal policy
- Monetary policy
- Trade policy
- Exchange rate policy

Answer: | Chapter No. |

*Question*

Fluctuations should be random. It is the requirement of which of the following technique(s)?

- Moving average technique only
- Exponential smoothing technique only
- Both moving average and exponential techniques
- Barometric technique

Answer: | Chapter No. |

*Question*

Which of the following shows accounting profit of the firm?

- Total revenue + explicit or accounting costs of production
- Total revenue - explicit or accounting costs of production
- Total revenue / explicit or accounting costs of production
- Total revenue × explicit or accounting costs of production

Answer: | Chapter No. |

*Question*

Consider the following equation of time series data: Yt = f (Tt, Ct, St, Rt) ________ shows trend component at time t.

- Tt
- Ct
- St
- Rt

Answer: | Chapter No. |

*Question*

The Isoquants have a shape of curvature for the inputs which are:

- Perfect substitutes
- Imperfect substitutes
- Perfect compliments
- Imperfect compliments

Answer: | Chapter No. |

*Question*

Both moving average and exponential techniques require:

- Random fluctuations
- Seasonal fluctuations
- Cyclical fluctuations
- No fluctuations

Answer: | Chapter No. |

*Question*

Given the Cobb Douglas production function: Q = A La Kb There will be constant returns to scale if:

- a + b > 1
- a + b < 1
- a + b = 1
- a + b = 0

Answer: | Chapter No. |

*Question*

When price of any commodity decreases, consumer’s purchasing power increases. This is known as:

- Income effect
- Price effect
- Substitution effect
- Real balance effect

Answer: | Chapter No. |

*Question*

Which of the following is (are) the assumption of regression analysis?

- Homoscedasticity
- No autocorrelation
- No perfect multicollinearity
- All of the given options

Answer: | Chapter No. |

*Question*

Which of the following is based on the data and equation?

- Qualitative forecasting
- Quantitative forecasting
- Regression analysis
- Time series analysis

Answer: | Chapter No. |